Today elected officials in Grand Rapids adopted a budget for 2012. The plan closes a $6 million budget gap in the city’s general fund.
The plan includes money for a new ‘transformation fund’ – which can only be used for one-time investments in long-term structural changes.
Grand Rapids took a couple measure last year to keep their budget out the red…they laid off around 175 employees and voters approved a city income tax hike.
City Manager Greg Sundstrom says up to $17 million for the transformation fund will come from the income tax increase.
“The one thing that they must all have in common is they must provide a quick and full return on investment so we can recover our cost.”
Grand Rapids City Commissioner Ruth Kelly says she will look to city staff for good ideas to reform city government.
“It’s so important that we never make anyone feel that, when we are changing it’s because they’re doing something wrong, it’s because we’ve been doing things the way we’ve been doing them and we need to rethink how we’re doing it in order to save money and to get more positive outcomes.”
Grand Rapids expects to deal with operating deficits until 2015, when city officials says city government will become financially sustainable again.
The long term budget plan eliminates $80 million in operating deficits over the next five years.